I’ve lived in Olympia for about ten years now and I love it up here. Olympia isn’t a “small town” per se - I think the combined population in the Olympia-Tumwater-Lacey area is 100,000 or so - but it’s got a laid back small town feel to it. Olympia itself has more of the reputation of being a mellow laid-back hippie haven, while Tumwater and Lacey have a more typical suburban feel to them. The weather, as noted, tends to be pretty gloomy and cold from about September through May-June, but summer is usually nice and sunny and hot. Climate-wise, coming from Texas you’ll notice that the days are a lot longer in the summer - sunset is around 9:30 on June evenings, with dusk not setting in until 11 or so, and it starts to get light shortly after 5. Conversely, it’s usually dark by 5 in the winter and doesn’t really start to get bright out until after 7 in the morning, so if you have issues with SAD you may want to invest in some brighter lighting for your house.
As far as traffic goes, I’ll second the above comment - Olympia-Tacoma is my daily work commute, and traffic snarls up very easily between Lacey and JBLM. There just aren’t enough lanes to accommodate the traffic volume in that area, so congestion is frequent during rush hour, and if there’s any kind of accident in that stretch of road it can easily cause a 15-mile backup. Get used to the drive if you enjoy going to concerts or sporting events or things of that nature, since Tacoma is the closest that major touring acts ever make it - and the Gorge, the absolute best concert venue in the northwest, is a solid three hour drive away in the middle of nowhere in central Washington.
Crime isn’t too much of a problem around here. Downtown Olympia and part of the west side are sort of run-down, and there are a few “questionable” neighborhoods in Lacey and Hawks Prairie, but for the most part the biggest problems you’ll have are the occasional pushy panhandler. Most of the homeless population is located downtown and the area can be kind of uncomfortable to be in after dark, but unless you’re into the bar scene or seeing a play downtown Olympia pretty much closes down at 8 PM. During the day there’s plenty to do downtown, however - lots of great local restaurants, independent stores, historical markers and monuments, a public artesian well which has recently been converted into a small city park, public murals and art, an open-air farmer’s market, and so on. Downtown is the only part of the area with parking meters, but they’re cheap (50 cents an hour, I think) and parking is free evenings and weekends. In the summer there are a lot of interesting public events that happen downtown - Lakefair, Arts Walk, the Pet Parade, Hempfest (if you’re so inclined), and other quirky stuff.
As far as restaurants go, you’ll find most of the national chains here, but you’ll have to head to Seattle/Tacoma if you’re craving a bowl of Ivar’s chowder or a burger from Dick’s. The local restaurant scene is great, though - there are a lot of unique local restaurants, brewpubs, and food trucks downtown and scattered throughout the area and a lot of different options out there. (We even have a Salvadorean restaurant, a food truck that sells Iraqi cuisine, a couple conveyor belt sushi restaurants, and a walk-up window next to the gay bar that sells hot dogs and cheesy tots until 3 AM.)
I’d personally recommend Big Tom burgers (little drive-up shack with a full-size TARDIS in the parking lot and open-face chili burgers to die for), Dirty Dave’s Gay '90s (a family pizzeria/spaghetti place with unique décor and a name that makes you wonder what kind of families they had in mind), and Paco’s Tacos in Lacey (the owner is a transplanted Texan and the menu is a mix of traditional Mexican, Tex-Mex, and southern CA Mexican) and Beau Legs (Louisiana style fish & chips / soul food tucked away at the ass-end of Hawks Prairie).
Overall, it’s a pretty good place to live, the people here are friendly, you’re pretty centrally located for the occasional day trip to Seattle or Portland, and the natural beauty of the region is amazing. (I still can’t get over the sight of Mt. Rainier in the distance on clear days.)